Trying to Beat Broadcast Over the Ears

Cable wants to put rabbit ears back in the home — a technical irony that could help the industry conserve big chunks of bandwidth on its network of fiber and coaxial transmission pipes.

The plan could also let the industry avoid shelling out millions in retransmission fees to broadcasters.

CableLabs, in a two-paragraph press release earlier this month, said it is developing specifications for an interface that would let set-top boxes receive digital broadcast signals off the air. This technology would allow households to see broadcast TV signals alongside cable programming “as an integrated viewing experience,” the consortium said.

Why would a cable operator want to do this?

The prime motivation appears to be improving cable’s bargaining position with broadcast TV station operators over carriage of their signals.

Under current public policy, broadcasters can pursue two paths in getting distribution for their stations on cable systems. Either they can force carriage, without getting payment, through federal must-carry rules. Or, if they want to get paid, they can negotiate specific agreements with cable operators over the terms of retransmission.

Antenna In a Set-Top: What’s At Stake

CableLabs is developing a specification to let set-top boxes receive TV broadcasters’ signals over the air in a fashion that would be “integrated” with programming that comes in from a cable. The technology could let operators:

Source: Multichannel News research

Save bandwidth for ’must-carry’ stations by picking them off the air, rather than pulling in from the coaxial cable network

Offer the full range of a local TV station’s digital multicasts, including high-definition signals

Avoid paying broadcasters for retransmission of their signals, since no retransmission is involved

Here’s how. The Federal Communications Commission has mandated that broadcasters provide all-digital over-the-air signals by Feb. 17, 2009. Existing FCC rules require operators to carry just one programming stream from each local digital-TV station that has elected mandatory carriage. Right now, those signals must be carried over the cable system’s physical plant. But if there’s a reliable technical alternative, such as this, those regulations may change.

The broadcasters might even push for the change. With the digital transition, TV stations would like operators to carry multiple programming streams — as many as five or six, including bandwidth-hungry high-definition signals, which can take up as much space as 10 standard-definition channels on a digital-cable system.

If set-tops with built-in digital tuners were widely deployed, cable operators could offer all of that local TV programming for “free” — that is, without having to pipe the digital signals over their networks. That could eventually let an operator reclaim valuable spectrum for other uses, such as high-speed data or HD programming.

In a city with at least five broadcast stations, and where an operator carries HD simulcasts for each one, pulling those feeds from the air could free up roughly 24 Megahertz of bandwidth in the cable system itself. That would provide space for 40 standard-definition channels in a digital tier of programming.

That would benefit broadcasters, according to a consultant who works with local TV affiliates, speaking on condition of anonymity.

“If implemented properly, the technology sounds as though it would give cable subscribers access to all the digital offerings of a local broadcaster, including a station’s multicast programming,” the consultant said.

RETRANS END-RUN?

If a broadcaster wants to negotiate for retransmission, however, the off-air receiver could help cable operators avoid paying tens or hundreds of millions of dollars for rights to retransmit the signals of local TV stations.

More broadcasters have been demanding that cable operators pay for the right to carry their signals. For example, CBS last month struck a deal worth $6 million per year with nine small cable operators (which it didn’t name), representing 1 million subscribers.

Sinclair Broadcast Group, which recently signed new agreements with Mediacom Communications, Time Warner Cable and Belo Corp., projects that it will take in $48 million in revenue this year from allowing retransmission of its local TV signals, up from $2.6 million in 2003 (“Dueling for Dollars,’’ March 5, 2007, page 6). For its part, Hearst-Argyle Television projects an almost tenfold increase to more than $18 million this year, up from $1.9 million in 2003.

Bruce Leichtman, president of consulting firm Leichtman Research Group, said a cable box with a tuner seemed intended to put cable in a less vulnerable position with broadcasters.

With this interface, viewers would technically be getting local-TV signals off the air, into their set-top boxes and then onto their TVs. The operator’s network of fiber and coaxial cable would not be involved.

“When companies like CBS are hell-bent at getting 50 cents a sub [for retransmission rights], it would certainly make sense for cable to say, 'Hey, we don’t need to pay you. We’ll just get the signal over the air,’ ” he said.

“It’s an intelligent, strategic use of technology,” Leichtman added. “It’s a bargaining chip for cable.”

CableLabs CEO Dick Green, when asked whether this technology could help operators sidestep retransmission agreements, declined to comment. Meanwhile, large multiple-system operators, including Comcast and Time Warner Cable, referred questions about the off-air project back to CableLabs.

“The honest truth is the MSOs have different ideas about how they’re going to use this,” Green said. “Those are business interests, and we [CableLabs] simply don’t get into those things.”

Green noted that direct-broadcast satellite operators today pluck local TV signals off the air, using tuners built into the dishes they’ve already installed on customers’ homes. That’s designed to let DBS providers conserve bandwidth on their satellites by not having to retransmit every single feed from every local TV station.

In addition, Green said that outside the United States, cable operators commonly provide broadcast signals by installing external antennas at subscribers’ homes.

National Association of Broadcasters director of media relations Kristopher Jones said the NAB is “reviewing CableLabs’s announcement” and declined to comment further.

But one senior executive at a major broadcaster, who asked to remain anonymous, dismissed the idea that a cable set-top with a built-in off-air tuner would somehow allow operators to avoid retransmission negotiations.

“If they want to have our channels integrated into the cable set-top, as part of their lineup, they would need our permission,” the executive said.

TECH TIMING

From the CableLabs perspective, Green said, there were three primary factors that made the timing right to develop a set-top with a digital antenna in it.

First is the FCC deadline for broadcasters to move to all-digital signals by February 2009. “We’re two years away from the digital transition, so all the industry players are getting more serious about this,” he said.

Second, Green said, developments in radio-frequency technology have made it possible to provide an off-air tuner on a single chip.

Finally, set-top boxes have greater processing power, which would allow them to use software to combine off-air signals with cable. “We could have done this in the past, but we didn’t have the processor capabilities,” he said.

In fact, Green claimed, CableLabs has been kicking around off-air concepts for about 15 years, but has only become feasible with the new technical breakthroughs. “It’s been on our back burner for some time,” he said.

Green expects to be able to demonstrate a working prototype of a set-top with a digital broadcast tuner before the end of 2007.

CableLabs is designing the specification to support multiple implementations. One could be a set-top with a built-in tuner, but the spec will also allow existing digital set-tops to connect to an external antenna.

For a viewer, clicking to a broadcast channel from a program guide hosted on the set-top would “be transparent to you … you wouldn’t need to know that they’re off-air,” Green said.